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MEDIA RELEASE: Recession Drives Increase in Number of Poor North Carolinians to 1.5 million

North Carolina Needs a Balanced Approach to Maintain Public Investments that Keep Families Afloat

Raleigh, NC (Sep. 28, 2010) -- Poverty rose sharply in every region of North Carolina in 2009, highlighting the widespread impact of the recession, according to information released today from the U.S. Census.

Today's Census data offers the first glimpse of the impact of the recession on North Carolina's families and shows even sharper increases in poverty and child poverty than anticipated.

"North Carolina's families are struggling to get by in this economic downturn and this is just the tip of the iceberg," said Louisa Warren, a Senior Policy Advocate at the NC Justice Center. "The Great Recession has pushed more than 168,000 North Carolina families into poverty just from 2008, a startling increase that will put pressure on our public systems as they work to support struggling families."

Poverty Rate

The Census' American Community Survey recorded a large jump in poverty in North Carolina, from 14.3 percent in 2007 to 16.3 percent in 2009. That puts nearly 1.5 million North Carolinians officially in poverty, or making at or below $22,050 annually for a family of four.

Poverty data for 37 counties was also released today and a more detailed analysis of local data and other indicators from the Census will be released by NC Justice Center staff tomorrow morning.

Similar to overall poverty, child poverty in North Carolina surged to 22.2 percent in 2009 from 19.2 percent in 2007. More than one in five children in North Carolina are now poor.

Further demonstrating the profound impact of the Great Recession, deep poverty -- those living below half the poverty rate -- has also risen considerably in North Carolina. In 2009, 7.1 percent of North Carolinians were living in deep poverty, making at or below $11,025 annually to support a family of four, up from 6 percent in 2007. In 2009, an estimated 643,429 North Carolinians were in deep poverty, representing significant distress for North Carolina.

The bleak picture painted by these numbers is actually an understatement. The census data released today were collected in the 12 month period around December 2008 when unemployment remained low relative to its levels in the latter half of 2009. Today's data is therefore just a first look at the recession's impact on poverty and family well-being.

Median Household Income

As a result of rising unemployment rates, median household income in North Carolina dropped to $43,674 in 2009, down from $46,210 in 2007.

Median household income varied across the state and the country. Robeson County had the lowest (among those for which data is available) median household income at $24,788 and many of the counties with high unemployment additionally experienced low median household income: Surry County's median household income was $33,159 while Burke County's median household income was $35,004. Urban counties continued to experience the highest median household income: Wake County's median household income, the highest in the state, was at $63,609 in 2009 and Mecklenburg County's median household income was at $52,881.

North Carolina's median household income remained lower than some of its Southern neighbors and Virgnia, Georgia, and Florida all had higher median household incomes in 2009.

Strategies for Change

Poverty will likely rise even higher next year if key federal Recovery Act provisions expire. In particular, programs aimed at low- and moderate-income households are set to end in the next few months if Congress does not act, including extra weeks of unemployment benefits, the TANF Emergency Fund jobs program, and the expanded Child Tax Credits.

"Today's poverty numbers should be an alarm bell for Congress to extend critical Recovery Act provisions that have been a lifeline for families in this recession," said Alexandra Forter-Sirota, a policy analyst with the N.C. Budget & Tax Center. "With the recession far from over, North Carolina's families still desperately need supports such as unemployment insurance and job creation programs like the TANF Emergency Fund."

At the state level, the jump in poverty comes amidst a recession that has caused a dramatic declines in state revenues, threatening the public services that North Carolina's struggling families rely on. In response to this crisis, state policymakers have deeply cut health care, education, and other key services, and more cuts likely lie ahead.

"The national recession and steep job loss has pushed many North Carolinians into poverty," said Louisa Warren of the NC Justice Center. "The situation will only get worse without a strong effort to meet the needs of struggling families. That means taking a balanced approach to our state's fiscal crisis that includes revenue. A cuts-only approach will hurt North Carolina's families and our state's prospects for economic recovery."